Group Membership

Table 40 in the Annex gives the status of group membership per
division. This Table indicates that Naula has a higher percentage of actual
group members than Dambulla, with Rattota having the lowest percentage. In
general, as mentioned above, the project has put more effort in Naula and
Dambulla divisions than in Rattota, whereas the project apparently started at a
later stage in Rattota. There is however, a variation in percentage of actual
membership between the different village clusters.

Table 14, documents that status of group membership as per
March 1989, by gender of the group. In sum, 70% of the members stated that they
are still member of a small farmer group, with a higher percentage of members of
mixed groups still being a member, followed by members of male groups and female
groups subsequently, this is visualized in Table 41. in the Annex. Though 29.6%
of the respondents ceased to be a group member, unexpectedly only one ex-member
(a male) mentioned that the reason for not being a member any more was the
unstable security situation in the project area during the 1989 period
characterized by sporadic violence and suppression by the Sri Lanka army. A
major reason was that the group itself had become inactive (25% for female and
mixed groups and 45% for male groups). 25% of the female and mixed group
ex-members indicated that the most important reason was that they moved to
another village when they married. All other reasons where mostly personal and
varied from lack of time or interest or problems among group members. In some
cases it is thus possible that the group is still active but that the respondent
has dropped out, or that the respondent is still member but of an inactive
group.

Table 14. Status Group Membership by Gender SFG as per
March 1990

Gender Group

Female

Male

Mixed

Total

No.

%

No.

%

No.

%

No.

%

Respondent is still group member

41

63.1

33

75.0

19

82.6

93

70.4

Respondent is not a group member anymore

24

36.9

11

25.00

4

17.4

39

29.6

Total

65

100.0

44

100.0

23

100.0

132

100.0

n = all respondentsSource: Resource-Base Survey, 1990.

Group Activities: Emphasis on
Cultivation

The survey was held at a time (March 1990) when the security
situation prevailing in the project area was not very favourable for initiating
group activities. Under the State Emergency Regulation it was not allowed that a
group of more than five adults would meet in public. However, when one compares
the number of groups that had activities during yala season 1989 with the number
of groups that had activities during maha 1989-90 season, which was the worst
period, there was only a 10% drop in activities for all groups together. A
larger drop occured for female groups (about 20%) than for male groups (about
7%) and mixed groups (about 9%). Thus, although men were during that period in
the more sensitive group in terms of security, more female groups did not have
activities. (See Tables 41 and 42 in the Annex).

Although 70% of the respondents stated that they were group
members by March 1990, during yala 1989, 61% of the groups actually had group
activities (with an equal division among the different gender groups). During
1989-90 maha season, the number of groups with group activities dropped to 48%
(with 43% for female groups, 52 % for male groups and 56% for mixed groups). The
main reason mentioned was that groups had become inactive (69% for all groups
during yala and 66% during maha), with the security situation as reason on a
lower place (17% during yala and 30% during maha). There is no significant
difference in reasons between the gender of the groups for not having
activities.

Tables 43 and 44 identify the group activities that were
reported during yala 1989 and maha 1989-90. A relatively equal distribution
occurs for both seasons. During maha there was a higher score on the
demonstration plots, mainly at the expense of labour pooling during cultivation
and group cultivation, because the project has, during that period, launched a
programmeme on improved dry crop varieties (maize, millet, beans, and some
vegetables), to be cultivated group wise, whereby the seeds were provided by the
project. It is significant that cultivation is as important, if not more
important, for women and mixed group members as for male group
members.

Furthermore, these tables clearly reveal that savings
activities by the members of male groups is neglible, in contrast to the members
of female groups and to some extent of mixed groups. The savings activities
mentioned by the female members usually concern seettu or rotating
savings and credit pools. This "informal" savings and credit activity may vary
in many respects: it can be a money or a specific good (such as rice or plates)
seettu, the amount donated per occasion can vary, as well as the time interval
for donation, and the management of the fund. This activity is thus apart from
the maintenance of a group fund.

Social activities are more often mentioned by male groups as
part of the group activities. Other, activities not pertaining to the actual
cultivation process are of limited importance, including activities related to
cultivation such as the purchase of inputs, post-harvesting of crops, and
marketing of agricultural produce, and non-cultivation activities such as small
industries or livestock. A small informal evaluation exercise done by the
project during yala 1989 revealed that none of the groups were involved in any
sort of rural enterprise including agro-processing.

About half of the group members stated that their group has
planned future activities, with a relatively equal distribution among the gender
groups. The major emphasis is again on cultivation, including labour pooling,
and demonstration plots. A second important planned future activity is "to
obtain loans" (15%). (See Tables 45 and 46 in the Annex). Again the most
important reason mentioned why group did not (yet) plan on future activities is
that groups have become inactive (83%). Nobody mentioned the security situation
as a reason for not planning future group activities.

The Group Fund: the Importance of
Informal Loans

One of the most important group activities promoted by the
project is the generation and maintenance of a group fund. Members were
motivated to make weekly or bi-weekly donations to the group fund, at the
occasion that a group meeting is held. The range of regular member contribution
to the fund, at the time of the survey, was between about Rs 1 to Rs 5. Apart
from the regular contribution, group members are motivated to engage in group
activities to augment the group fund. About 40% of the group members reported to
have participated in group activities during the past three years that resulted
in an increase in their group fund. Often the income benefits accruing from such
a group activity are partly divided among the group members and part is donated
to the group fund. The most important group activity in this context is again
group cultivation (55% for all groups together), with savings activities,
especially among female groups (31%) in a second place. (See Table 47 in the
Annex).

The group fund is often used as collateral in obtaining bank
loans (as a deposit), to fund other group activities or to relend to members as
small short-term loans, etc. Group fund assets can be classified as follows: 1)
funds held by the members (usually the treasurer) in cash ('fund in hand'); 2)
funds loaned out to group members informally; 3) funds deposited in a savings
account in a bank; and 4) as goods (mostly rice) which are kept by the
group.

Nearly all those surveyed, whether still a group member or
not, or whether active members or not, stated that their (original) group
maintains a group fund, with high percentages for male and mixed groups (97.7%
and 95.7% respectively) and a lower percentage for female groups (81.5%). (See
Table 48 in the Annex). However, only 49% of the members made a contribution to
the group fund in 1990, and 16% made their last contribution in 1988.

Tables 15.1-4 give the distribution of the groups funds for
the different gender groups.

An obvious feature in these tables is that on the average
about 35% of the group members of groups that maintain a group fund do not know
what amount of money or value is kept in one or more categories of the group
fund. However, in the cases that the group member is aware of the amounts kept
in the group fund, the total amount is high: 32% of the groups maintain a fund
of over Rs 2,000 and 45% of over Rs 1,000. The male groups maintain larger group
funds than the female groups.

All groups surveyed, excluding non-respondents, keep the money
or goods divided in the different categories. Male groups, especially, seem to
use a large part of the fund for informal loans among group members. For female
groups, however, this may be compensated by their seettu activities, outside the
group fund.

Table 15.1 Distribution of the Group Fund for Female
Groups

n =53

Categories of the group fund

Fund in Hand

Fund Loaned Internal

Fund in Bank

Value of Goods

Total

No.

%

No.

%

No.

%

No.

%

No.

%

Amount

less than Rs200

10

18.9

11

20.8

16

30.2

30

56.6

1

1.9

Rs 200 - Rs 499

9

17.0

7

13.2

5

9.4

0

0.0

4

7.5

Rs 500 - Rs 999

8

15.1

8

15.1

4

7.6

1

1.9

3

5.7

Rs1000 - Rs1999

5

9.4

2

3.8

8

15.0

0

0.0

9

17.0

Rs2000 and more

1

1.9

5

9.4

4

7.6

0

0.0

15

28.3

Does not know

20

37.7

20

37.7

16

30.2

20

37.7

20

37.7

No response

0

0.0

0

0.0

0

0.0

2

3.8

1

1.9

Total

53

100.0

53

100.0

53

100.0

53

100.0

53

100.0

n = all female members of groups that maintain a
group fund.Source: Resource-Base Survey, 1990.

Table 15.2 Distribution of the Group Fund for Male Groups

n = 43

Categories of the group fund

Fund in Hand

Fund Loaned Internal

Fund in Bank

Value of Goods

Total

No.

%

No.

%

No.

%

No.

%

No.

%

Amount

less than Rs200

12

27.9

4

9.3

14

32.6

18

41.9

2

4.7

Rs 200 - Rs 499

5

11.6

3

7.0

4

9.3

1

2.3

0

0.0

Rs 500 - Rs 999

5

11.6

9

20.9

6

13.9

0

0.0

3

7.0

Rs1000 - Rs1999

5

11.6

8

18.6

3

7.0

5

11.6

4

9.3

Rs2000 and more

4

9.4

5

11.6

3

7.0

3

7.0

17

39.5

Does not know

12

27.9

14

32.6

13

30.2

16

37.2

20

39.5

No response

0

0.0

0

0.0

0

0.0

0

0.0

0

0.0

Total

43

100.0

53

100.0

53

100.0

53

100.0

53

100.0

n = all male members of groups that maintain a
group fund.Source: Resource-Base Survey, 1990.

Table 15.3 Distribution of the Group Fund for Mixed
Groups

n = 22

Categories of the group fund

Fund in Hand

Fund Loaned Internal

Fund in Bank

Value of Goods

Total

No.

%

No.

%

No.

%

No.

%

No.

%

Amount

less than Rs200

6

27.3

7

31.8

8

36.4

12

54.6

4

18.2

Rs 200 - Rs 499

4

18.2

5

22.7

1

4.5

0

0.0

1

4.5

Rs 500 - Rs 999

2

9.1

1

4.5

1

4.5

0

0.0

1

4.5

Rs1000 - Rs1999

1

4.5

1

4.5

1

4.5

0

0.0

2

9.1

Rs2000 and more

1

4.5

2

9.1

3

13.6

1

4.5

6

27.3

Does not know

7

31.8

5

22.8

7

31.8

7

31.8

7

31.8

No response

1

4.5

1

4.5

1

4.5

2

9.1

1

4.5

Total

22

100.0

22

100.0

22

100.0

22

100.0

22

100.0

n = all members of mixed groups that maintain a
group fund.Source: Resource-Base Survey, 1990.

Table 15.4 Distribution of the Group Fund for All
Groups

n = 118

Categories of the group fund

Fund in Hand

Fund Loaned Internal

Fund in Bank

Value of Goods

Total

No.

%

No.

%

No.

%

No.

%

No.

%

Amount

less than Rs200

28

23.7

22

18.6

38

32.2

60

50.9

7

5.9

Rs 200 - Rs 499

18

15.3

15

12.7

10

8.5

1

0.9

5

4.2

Rs 500 - Rs 999

15

12.7

18

15.3

11

9.3

1

0.9

7

5.9

Rs1000 - Rs1999

11

9.3

11

9.3

12

10.2

5

4.2

15

12.7

Rs2000 and more

6

5.1

12

10.2

10

8.5

4

3.4

38

32.2

Does not know

39

33.1

39

33.1

36

30.5

43

36.4

44

37.3

No response

1

0.9

1

0.9

1

0.9

4

3.4

2

1.7

Total

118

100.0

118

100.0

118

100.0

118

100.0

118

100.0

n = all members of groups that maintain a group
fund.Source: Resource-Base Survey, 1990.

Table 16 outlines the purposes of the group fund by gender of
the group, for all members of groups that maintain a group fund, whether
actively or not. It is clear that the group fund is mostly used for providing
informal loans to group members (83%), with a relatively equal distribution
among the groups. None of the group members indicated a relation between the
group fund and eligibility for obtaining bank loans, which is one of the formal
purposes of the fund. The fund is apparently not used for issuing loans to
non-group members, which denotes a certain closeness of the group. As second and
third most important purposes come the purchase of inputs or consumer items
(30%) and contributions to the village board (28%).

28.0% of the members reported that contributions to the
Village Board fund were made from the group fund. The mixed groups are the best
contributors with 30.4%, followed by the female groups (27.7%) and the male
groups (18.8%).

Table 16. Purposes of the Group Fund by Gender of the
Group

Gender of the Group

Femalen=53

Malen=43

Mixedn=22

Totaln=118

No.

%

No.

%

No.

%

No.

%

Purposes of the group fund

Internal loans to members

45

84.9

38

88.4

15

68.2

98

83.1

Admin. costs of the group

7

13.2

4

9.3

5

22.7

16

13.6

Contributions to the Village Board

18

34.0

8

18.6

7

31.8

33

28.0

Expenses during meeting/group activities

6

11.3

5

11.6

2

9.1

13

11.0

Purchase inputs/consumer goods

15

28.3

15

34.9

5

22.7

35

29.7

Death donations

0

0.0

0

0.0

2

9.1

2

1.7

Built a meeting hall

1

1.9

0

0.0

1

4.5

2

1.7

Group farming/demo. plots

0

0.0

3

7.0

0

0.0

3

2.5

Marketing agr. products

0

0.0

1

2.3

0

0.0

1

0.9

Common group activities

1

1.9

0

0.0

0

0.0

1

0.9

Not used for any purpose

2

3.8

1

2.3

1

4.5

4

3.4

Does not know

1

1.9

1

2.3

0

0.0

2

1.7

No response

1

1.9

1

2.3

0

0.0

2

1.7

n = all group members who reported that their
group maintains a group fund.Multiple responseSource: Resource-Base Survey, 1990.

A rather large number of group members reported incidence of
default when informal loans were given to group members, i.e., 28%, with a
relatively equal distribution among groups. (See Table 49 in the Annex).
Although many group members did not know which amount of money or value of goods
was exactly kept in the group fund (as mentioned above), nearly all of them were
aware of this issue. The total amount in default per group can be substantial,
often up to Rs 1,000/= and in some cases even more than Rs 2,000/=. (See Table
50 in the Annex). The most frequently mentioned reason for this default was that
the borrower is not living in the village anymore, followed by the borrower
being unable to pay and the borrower having resigned from the group.

Given the importance of the groups issuing informal loans to
group members and the relatively high incidence of default on such loans, this
may be a major reason why some groups have become inactive. It will be
impossible, as well as unwanted, for the project to regulate this activity.
However, the group organizers should be well aware of this, and could assist the
groups in making decisions for sustaining a fair and profitable use of the group
fund for informal loans. Thus not so much assistance in the form of training in
accounting, since many of the group members are literate and do know the basic
principles of accounting, but more in the form of advice 'on the job', if
desired by the group members.

Participation in activities initiated
by the project

Training

59.1% of the respondents reported that they received one or
more trainings through the project, with a maximum of four trainings per person
among 9.1% of the respondents. There does not seem to be a gender bias in
training received. However, it is not clear whether all trainings referred to by
the respondents were indeed organized by the project, such as training in
beekeeping, mushroom cultivation, sewing, flower and brick making and minor
export crops cultivation. Also the definition of training is not very clear,
since many of the trainings were held in the respondents own village (61.3%) and
could be more an extension activity than a training course. Again, the largest
part of the training concerns cultivation (68.8%) and were given by the
Department of Agriculture (47.5%), with training in group issues on a second
place (27.5%). (See Tables 51 and 52 in the Annex).

When asked what kind of training the respondent would like to
receive to augment their income, cultivation was most frequently mentioned
(60.6%), followed by handicrafts/industries and animal husbandry (each 22.0%).
(See Table 53 in the Annex).

Savings and Credit

As mentioned in Chapter 4, according to the respondents, a
large part of the institutional loans were obtained with the assistance of the
project, this was the case for 82.3% of the female members and 69.3% of the male
members. (See Table 27 in the Annex). In sum, 24.2% of all group members
obtained a loan in 1989 with the assistance of the project, including 18.9% of
the female members and 31.0% of the male members.

Given the larger percentage of female group members (i.e., 56%
and 44% male group members), there is still a male bias in the provision of
credit to group members. This is especially important because the credit
facilities provided by the project are for many women the only source of formal
credit, whereas male group members often appear to have more sources for formal
and informal credit supply. That credit supply is indeed the most important
benefit attributed by female group members, indicates the interest women have in
obtaining loans. 46.6% of the female members regard obtaining loans as one of
the most important (potential) benefits of the project, compared to 22.2% of the
male members. This is indicated in Table 17. at the end of this
chapter.

Limited capacity to generate savings among group members is
not a sustainable argument against loan supply, because about 41 % of all female
group members maintain a savings account of over Rs100 in a bank and about 57%
of all male group members. See Tables 23.1 and 23.2 in the Annex. In addition,
female members appear to be active in informal group savings and credit
activities (seettu).

Elections

Rotating leadership is one of the unique features of the PPP
approach in Sri Lanka. Groups are requested to have elections each half year,
where the full board, officially comprising of a President, a Secretary and a
Treasurer, are replaced by new persons. Indeed, 77.3 % of the members stated
that they had been a board member at least once. There seems to be more rotation
of board membership among male and mixed groups than among female groups:
provided that group sizes are about the same for the different gender of the
groups, about 20% more members of male and mixed groups have been board member
for a least one period. (See Table 54 in the Annex). When one divides the board
membership of mixed groups by gender, there does not seem to be much evidence of
male members dominating the board in mixed groups.

The small farmer group, due to its frequent elections, seems
to enhance that persons were elected as board member who had not earlier been a
board member in any other village level society. Out of the 107 persons who
never fulfilled an office post in a society they are at present member of
(including the persons who are not member of any other society) apart from the
small farmer group, 57.9% were one or more times elected as board member of a
small farmer group.

Half of the groups stated having their last board election
during 1989 or 1990, with more recent elections being held among members of
mixed groups (73.9%) than of members of female groups (46.2%) or male groups
(43.2%) during that period. A fairly high percentage of respondents (29.6%) did
not remember when the last board election has been held. (See Table 55 in the
Annex).

The Role of the Village
Board

77.3% of group members reported that they were aware of the
existence of the Village Board, with a relatively equal distribution among the
gender groups. Of the persons aware of the Village Board, 57.8% (i.e., 44.7% of
all group members) felt that the Village Board had been of assistance.
Relatively more members of male groups felt that the Village Board had been of
assistance. The major field of assistance mentioned was organizing training
(42.4%).

Especially members of female groups stressed this activity
(52.0%). However, what the members actually mean by this activity is not clear,
because training courses were normally organized by project staff. Perhaps the
Village Board played an important role in selecting the participants. Other main
fields of assistance mentioned are the supply of agricultural inputs and
implements (28.8%), assisting, giving advice and solving problems of the groups
(28.8%) and organizing savings and loan activities (20.3%). Table 56 in the
Annex shows the fields of assistance provided by the village board by the gender
of the group.

The group members who were aware of the existence of the
village board, were also asked to state what they felt the duties of the village
board should be. See Table 57. in the Annex. As a duty, organizing training did
not receive a high priority (22.0%). Instead, the highest value was attributed
to assisting, giving advice and solving problems of the groups (50.9%). 27.1% of
the group members (i.e., 12.1% of all group members) felt that the Village Board
should organize savings and loan activities. With a view on the withdrawal of
the Group Organizers from the village clusters in Naula, Dambulla and Rattota
divisions in the near future, the project attributes a key role to the village
boards in organizing the savings and loan activities. It is doubtful whether, at
least at the time of the survey, the majority of the group members has
confidence that the village board could assume such a key role.

As shown in Table 16 of this chapter, contributions to the
Village Board Fund were reported to be made by 28.0% of the members of groups
who maintain a group fund (i.e., 25.0% of all group members). Although, compared
with the other groups, fewer members of female groups felt that the village
board provided any assistance, relatively more members of female and mixed
groups contributed to the Village Board Fund than members of male groups (34.0%,
31,8% and 19% respectively). A reason behind this might be that female members
have more expectations of the village board, as they have, compared to male
members, less access to external sources, such as institutional
credit.

Benefits derived from being member of
a small farmer group

When asked whether the project was beneficial, 78% of the
group members said yes. The percentages for female and male members are nearly
equal. However, it is difficult to assess how reliable these figures are, sine
this survey was done by project staff. Table 17 shows the benefits that members
attribute to being small farmer group member. For female members obtaining loans
was the most important benefit, i.e., stated by 36.5% of all female members.
Since 19% of the females actually did receive a bank loan with the help of the
project during 1989, this is probably partly a benefit that they hope to obtain
in the future. As shown before, for them the project is one of the few
possibilities to gain access to institutional loans. For male members, labour
pooling was the most frequently mentioned benefit, i.e., 48.1% of all male
members. It is significant that a large part of the benefits mentioned by the
members, are related to their own capacity to increase their agricultural or
other resources, such as obtaining loans, labour pooling and savings activities.
A relatively smaller part refers to obtaining external benefits, such as
subsidies, agricultural inputs and land.

Furthermore, 28.0% of all members felt that group membership
was beneficial for obtaining more personal knowledge and recognition. Although,
59.1 % of the members had stated that they had participated in one or more
training courses organized by the project, training was not valued as one of the
most important benefits. Only few members made the direct link between group
membership and the opportunity to augment their income.

Table 17. Benefits Derived From Being Small Farmer Group
Member by Gender

Gender

Femalen=58

Malen=45

Totaln=103

No.

%

No.

%

No.

%

Benefits

Obtaining loans

27

46.6

10

22.2

37

35.9

Labour pooling

23

39.7

26

57.8

49

47.6

Personal knowledge/ Education Awareness/ Recognition

19

32.8

18

40.0

37

35.9

Training general/Education Accounting

10

17.2

10

22.2

20

19.4

Training in cultivation or Foodprocessing

7

12.1

15

33.3

22

21.4

Obtaining Agr. Inputs

6

10.4

14

31.1

20

19.4

Cultivation General

2

3.5

4

8.9

6

5.8

Savings Activities

13

22.4

3

6.7

16

15.5

Animal Husbandry

2

3.5

1

2.2

3

2.9

Knowledge about Government or 'Outside' Services

10

17.2

4

8.9

14

13.6

Group Efforts (General/ House/Wells)

7

12.1

11

24.4

18

17.5

Subsidies/Obtaining Goods at Lower Prices

5

8.6

3

6.7

8

7.8

Obtaining Land

1

1.7

1

2.2

2

1.9

Income Opportunity

5

8.6

4

8.9

9

8.7

n = all members who considered it beneficial to be
a member of a small farmer groupMultiple ResponseSource: Resource-Base Survey, 1990.